In February 2021, Jeremy Segal launched SOLminer — “SOL” as the Spanish word for “sun” — a Paducah-based cryptocurrency-mining operation and hosting service.
“Long term, our mission is
to be solar-powered,” Segal, 35, recently told The Sun. “There’s not a lot of solar energy on the local grid.”
SOLminer buys renewable energy credits as a green energy incentive, which the Florida native has spoken about at crypto conferences, encouraging other miners to follow suit.
SOLminer differs somewhat from other regional crypto companies. It’s smaller, mining with 7,000 computer graphics cards at a 3.75-megawatt capacity between two Paducah sites. One site also houses an additional 22-megawatt capacity for ASIC hardware.
It also primarily mines
Ether — a currency second to Bitcoin in market capitalization
and representing Ethereum,
a blockchain-based software platform that companies like Amazon and Microsoft have invested in for future product launches.
Aside from distant relatives growing up in the area, Segal said Paducah’s environment had business and family appeal. Last June, he relocated to the area with his wife and 9-month-old son.
“We’re members of the (National) Quilt Museum and recognize and know several people at the Farmer’s Market, coffee shops and restaurants,” he said.
“Paducah’s also poised for growth. It’s got a lot of infrastructure, and it’s building more, but that growth hasn’t fully hit yet.”
“We were looking at Illinois, Washington and New York, but we were hearing stories even two years ago about the consensus on crypto farms changing. Hearing (in Kentucky), ‘No, we don’t do crypto here,’ seems like it would be a pretty big swing compared to other places.”
Doug Handley, Paducah Power System director of finance, power supply and rates, said SOLminer operates under the same market-based rate as similar industry companies.
After graduating from Florida State University with a bachelor’s degree in accounting, Segal obtained a master’s in information systems management from the University of South Florida.
“I wanted to figure out how businesses run,” he said. After working at Ernst & Young, at age 25, he became the chief financial officer of Bay Dermatology, a 130-employee medical practice in the Tampa Bay area.
“I was very driven to be an entrepreneur, but I couldn’t be that without being a CFO first — it was a mental block,” he said. “Once I got there … after that, I started my own business.”
Segal and a friend ran a drone accessories company for two years before selling the business and launching a Japanese sports car dealership in Clearwater, Florida. Under a United States import rule, they met fewer restrictions with importing vehicles made more than 25 years ago.
“The Nissan Skyline GTR 1989 — we were the first to import that, and the niche dealership created a media splash at the time,” he said.
“I’ve paid myself a bare-minimum salary, which had its pressures on my family, because I was reinvesting everything back into business. Until recently, my (take-home) salary wasn’t much higher than my first job.”
They liquidated the dealership six years later. Segal set his eyes on crypto, buying an Industrial Park West lot through Greater Paducah Economic Development.
“It isn’t the best fit (yet, for expansion),” Segal said. He also runs an additional site in Florida remotely. “We’re running lean, cutting costs as best we can and maximizing equipment efficiency. We want to ensure in a market downturn that we’re in the best position possible.”
Despite current soaring energy prices, Segal said electricity futures show upcoming rate drops: “Electricity prices are expected to settle in the coming months. SOLminer does GPU mining, which is able to maintain profitability better than ASIC (Bitcoin) miners when electricity prices are high like they are now.”
In September, an ongoing software upgrade called the Merge could render Ether-mining obsolete, making the currency deflationary. Ideally, the scarcity would enhance investment value.
“Sure, it could impact things, but that talk’s been going on for over six years,” he said, referring to frequently stalled upgrades that have become a running joke in the crypto community.
“There are a host of other (currencies) to mine, like Monero and Ravencoin.” A popular website, WhatToMine.com, lists the current most profitable currencies anyone can mine with profit calculators based on hardware.
“I’ve run a business before, and we’ll figure it out,” he said, explaining other use cases like AI computing and 3D rendering.
Some argue crypto has hit its peak, beginning with Biden-era regulation.
After the 2022 Superbowl featured A-list celebrities touting crypto products and services, pundits referenced the Dot-com bubble. In Dec. 2021, the Staples Center in Los Angeles rebranded to the Crypto.com Arena, leading some to mark it as crypto’s death knell.
Segal remains optimistic.
“Cryptocurrency has always gone in cycles since the beginning. I don’t have an answer (for the future), but I do think blockchain is here to stay,” he said.
“There have always been big swings in the market and in people, organizations and governments wanting to control blockchain technology. Typically those that hold power try hard to hold onto that power for as long as they can.
“It’s harder to control blockchain, and I think eventually we’re going to own all of our data. Is it going to happen in our lifetime?” He shrugged, “but I think that’s where the future is headed.”